A Review of the Nigerian Energy Industry

Unending intrigues in Delta over DESOPADEC

26 August 2015, Warri – Delta State governor, Senator Ifeanyi Okowa, obviously knew what was at stake when he embarked on a trouble-shooting mission to the palace of the Olu of Warri, HRM, Ogiama Atuwatse II, at the weekend.

Chief Rita Lori-Ogbebor

His enterprise was to ask the respected monarch to prevail on one of his fiery subjects, the Igba of Warri Kingdom, Chief Rita Lori-Ogbebor, to drop her antagonism to the recently signed Amended law on the Delta State Oil Producing Areas Development Commission, DESOPADEC. The other was also for her to rescind her threat to drag the state government to court if he (Okowa) did not repeal the law within seven days.

Lori-Ogbebor’s antecedents: Anybody, who knows Chief Lori-Ogbebor well enough and her doggedness in matters she believes in can only agree that she is a hard nut to crack. Former Governors James Ibori and Emmanuel Uduaghan had bitter doses of her radicalism during their stints in power over what she felt was their anti-people stand on the policies of their governments, including 13 per cent derivation to the oil communities.

She took Uduaghan to court over his plan to name a school on a disputed land in Okere after the Olu of Warri and rejected a Christmas gift from his government in 2013. Lori-Ogbebor had fought virtually every government in the state on where she felt bad and supported them when need be.

Okowa’s tactical move

Governor Okowa, who had watched her exploits over the years from the sidelines, understood what it means to be at loggerheads with the “Iron Lady of Warri”.

The Olu of Warri, who Okowa rushed to for intervention, also recognised why he would not shave Lori-Ogbebor’s head in her absence. A source said the monarch after listening to the Governor tactically advised him “not to undermine the Igba of Warri, Chief Rita Lori-Ogbebor, in negotiating the interest of the Itsekiri  as it affects DESOPADEC.”

The Governor, accompanied by the member representing Warri Federal Constituency, Daniel Reyenieju, reportedly told the monarch that a palace chief has been slated for a top position in the soon-to-be constituted DESOPADEC Board, but the guarded traditional ruler responded that he did not know the nominee whose name the governor mentioned.

Last week Wednesday, Chief Lori-Ogbebor gave the Governor a seven-day ultimatum to reverse his position on the newly signed law. She argued that the law, which grants DESOPADEC 50 percent of the accrued 13 per cent derivation fund to the state was unconstitutional to the extent of its contradiction  of  the Nigerian Constitution, which, she said, supports 100 per cent of  the derivation being used for the development of only oil-producing areas of the state.

Storm before the passage

In fact, it was hostilities before the House of Assembly passed be bill for the new law, as a section of the host communities in the state, led by pioneer chair of DESOPADEC, Chief Wellington Okirika, rejected the amendment until their interests were included. The Ijaw and Urhobo oil communities had threatened to shut down oil facilities in their domains if Okowa did not listen to the demands.

Chief Okirika hailed the governor and the House of Assembly soon after he signed the amended bill, but the rejection of the same law by Lori-Ogbebor and her group suggested a fresh rumble among the leaders of the host communities.


Some leaders of the oil communities in the state kept sealed lips when contacted by Vanguard Metro on the matter.
Maikpobi knocks Lori-Ogbebor: However, National  Coordinator of Host Communities of Nigeria, HOSTCOM, Prince Okareme Maikpobi, slammed Chief Lori –Ogbebor over her seven-day ultimatum to the state government to abrogate the new law, saying it was impracticable.

Prince Maikpobi, who is also the national chair, Board of Trustees, Community Development Committee, CDC of Oil and Gas Producing Communities in the Niger-Delta, insisted: “The law has been signed, all we want is reflected in the law. Host communities are happy with the law as it is today. Areas of concern to us have been the timely release of fund and the governor, Dr. Ifeanyi Okowa, has assured that he will implement the law to the letter.”

He said: “Chief Lori-Ogbebor’s call for repeal of the law is not realistic. We had canvassed this position before at the federal level; we took it up at the Revenue Mobilization and Fiscal and Allocation Commission, RMFAC. However, their position is that oil communities are not part of the three tiers of government for the purpose of revenue sharing. We all know it is federal, state and local governments and the state created DESOPADEC to hold the 13 per cent derivation fund in trust for the oil communities. The ideal thing is to pay the total 13 per cent to the oil communities. That is our position, but frankly speaking, there is no approved structure for such disbursement without passing through the state government.”

Ikimi joins the fray: Warri-based lawyer and activist, Mr. Oghenejabor Ikimi, also faulted Lori-Ogbebor’s decision to go to court, saying it was an exercise in futility. However, he agreed with her that the entire 13 per cent derivation fund belongs to the oil communities, according to Section 162 (2) of the 1999 Constitution of the Federal Republic of Nigeria (as amended).

Ikimi added: “Having said that, I make bold to say further and without holding brief for the Delta State Government or patronising her that any proposed litigation would be an ill -fated exercise.”

Consolidated revenues

His words: “ This is because while Section 162(3) (4) and (5) of the 1999 Constitution provides for how monies standing to the credit of the federal, state and local governments in the Federation Account as consolidated revenues are to be managed by the three tiers of government.   Section 162(2) of the same Constitution is silent on the way and manner 13 per cent derivation fund should be managed.”

Host communities can’t manage 13% derivation for now:   “To this end, the 13 per cent derivation fund, which constitutionally belongs to oil and gas producing communities cannot be managed directly by them in the absence of an administrative structure and an Act of the National Assembly empowering them to so do, as they are not a self-accounting unit such as government ministries or extra ministerial departments.
“It is this gap created by the Constitution that has given the state governors in the Niger Delta region the latitude to manage the derivation fund on behalf of the oil and gas producing communities,” he posited

Ikimi asserted: “The lacuna created by the Constitution requires a political solution as opposed to a litigation that would do the host communities no good.”

Derivation Fund Commission: He said: “As a way of resolving the above lacunae politically, a Derivation Fund Commission established by an Act of parliament was proposed in recent past by some Niger Delta activists, having seen the fruitlessness in embarking on litigation.

“A board membership consisting of   chairman, secretary and members to be drawn from the nine states within the region and a staff of the Revenue Mobilisation, Allocation and Fiscal Commission, RMAFC, was also suggested for the purpose of supervising the distribution of the 13 percent derivation fund in full to states with oil and gas producing commissions.

“While it manages in full the funds for those states within the region that are without such commissions. To drive home my above point that a political solution is the answer in the above regard as oppose to a litigation,   the case of the Judiciary Staff Union of Nigeria whose members went to court for the interpretation of Section 162(9) of the 1999 Constitution (as amended) is very apt in this regard.

“The above provision of the constitution guaranteed the financial autonomy of the judiciary to the effect that any amount standing to the credit of the Judiciary in the Federation Account shall be paid directly to the National Judicial Council for distribution to the heads of court.

Ineffectiveness of court action

“However,  in January, 2014 an Abuja High Court delivered judgement in favour of the union, but till date,   the said judgement has been largely unenforceable owing to the fact that the National Judicial Council,   whose main functions are to ensure the rule of law and justice is not a self accounting unit,” he said.
Ikimi disclosed: “As such, an Act of the National Assembly is required to give the Accountant General of the Federation power to deduct funds due the judicial arm of government directly from the consolidated revenue in the Federation Account and pay same to the National Judicial Council for onward transmission to heads of court nationwide.
“Even with a valid judgment at the disposal of the union, members are at a dilemma as to the way and manner to enforce the said judgment and   have resorted to strike action in a bid to further press home their demand. “

“Little wonder many state High Courts in the country are still under lock and key since January this year till date. Federal Courts and few state High Courts are operating the then federal Attorney General and some state Attorney General and the striking union having worked out a political solution on the issue,” he said.

What should worry oil communities?

The activist stated: “ I think what all Deltans,   particularly those from the oil and gas producing communities should be concerned about at the moment,   until the above issues are resolved,     is  that 50 percent of the 13 percent of the derivation fund accruing to the state from the Federation Account   is utilised judiciously for the benefit of the host communities.”

He said the channel to utilise the funds remains   the yet to be constituted DESOPADEC Board, which must be devoid of undue political interference from the State Executive and the State Legislature.

Ikimi pointed out: “There is the urgent need to insulate DESOPADEC from undue political interference by appointing credible technocrats to man the Commission so that the body can realise her mandate to the host communities.”

He called on Governor Okowa to be wary of the horde of politicians jostling for appointment into the DESOPADEC board in a bid to getting it right this time around.


– Vanguard

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